“We’ve chosen our dance partner…. and we’re entering into a courtship that marks the beginning of a long journey together,” was how Scotts Valley Mayor Jim Reed characterized the choice of Palisades Builders, Inc. for the massive Town Center Project at a standing room only meeting of the City Council on March 21.
This long awaited step toward building a new downtown in the heart of Scotts Valley on about 14 acres of the former Sky Park airport came after careful consideration of two final proposals- and many years of planning, false starts, waiting for the overall economy to improve and finding the right developer.
Palisades Builders, Inc., with offices in the Pruneyard Shopping Center in Campbell, has developed more than 15,000 units in many projects around the Bay Area and in Santa Cruz including commercial, mixed use and historic renovation projects. The second finalist, Braddock and Logan, was said to be equally qualified with an equally impressive resume and proposed a similar vision of the town center, but with some significant differences.
Both developers proposed about 300 housing units in different configurations and about 25,000 square feet of retail/office space with differing designs of circulation around a town green or central town square. While the Palisades Builders proposal included more expensive parking structures and more open space than the Braddock and Logan proposal, it also proposed a taller, four-story building that drew concern about height, mass and fire safety.
Mayor Reed explained that all the developers they heard from said they would make their money on the residential and that retail and commercial was the most risky. There would need to be a “fairly large number of housing units to make this pencil out,” Reed said.
“It’s the retail that we need,” councilmember Donna Lind said. “This project has to help the city economically, and housing doesn’t really help us financially – with the draw on city services that housing entails.”
Discussed at length by Mayor Reed and other council members was reaching the proper balance of housing and retail that meets the expectations of the community, yet will be profitable enough for the developer to build. Both proposals included much more housing and far less retail than was envisioned in the Town Center Specific Plan, a plan developed by the city 10 years ago that set out the development guidelines and goals for the Town Center Project.
“Look how much the world has changed over the last 10 years or so, with the Amazonification of retail,” Reed said. “It’s natural for us to want our cake and eat it too- to have great city services and experiential retail, restaurants and brew pubs in our town center.”
According to Doug Ross, of Palisades Builders, the housing has to be there to support the retail. The retail cannot carry the project.
Several residents at the meeting expressed fears of too much housing development coming to Scotts Valley and the ability of the city’s infrastructure to handle it, particularly with regard to traffic.
“We need to have a discussion as a community about how much more housing we want,” Mayor Reed said. “We will need to decide where the trade-off is between potentially changing the small town character we all cherish versus how far does this project will get us so that our kids can live here.”
Both proposals included partnering with nonprofit housing developers for affordable housing in the plan, about 20 percent of the proposed housing in both proposals, with Palisades Builders partnering with Eden Housing of Hayward and Braddock & Logan with Habitat for Humanity of Silicon Valley.
“What’s important for the community to realize,” City Manager Jenny Haruyama pointed out after the meeting, “is that what’s on the plan is unlikely to get built as proposed….these are conceptual designs intended to show the creativity and thought processes of the developer.” Haruyama emphasized that an extended community process involving many meetings and design charrettes will ultimately result in the final plan for the project.
“Through this community conversation of arriving at a final plan, the community will have to understand what the tradeoffs are and how those tradeoffs will impact them and impact the city from a financial point of view,” Haruyama said.
The next steps are for the City of Scotts Valley and Palisades Builders to negotiate an Executive Negotiation Agreement that will detail the time line of development, the milestones and financial pro forms of what will work and the final development agreement. Meanwhile, both of the finalist developers submitted a Letter of Interest to the City of Santa Cruz to purchase those parcels owned by the City of Santa Cruz in the TownCenter project area.
“This is just a vision…it is not the plan we are approving,” Reed said. “This is the beginning of an 18 to 24 month process to develop the final plan, and we’re going to have public input on every phase of this plan.”
